Is the used car market getting back to "normal"

[Fastcar155]

Hi , it's the actual cost to change your car that matters and not what a dealer offers you for it.

My C207E400 65 plate 45000 miles with a complete Mercedes service history was valued by Car Wow £12 K

No idea what it would cost me to change to the new equivalent Mercedes but I won't be finding out.

 

[Red C220]

If your car is less than 7 years old then that’s cheating!

Only joking. I assume yours is probably on PAYG now as almost all FFs must be out of the inclusive period now.

I’ve not got any experience of Taycan service costs - I’d expect them to be pricy for what they are but surely the Taycan is below the major services on the FF.

How much are Taycan services?

First service was quoted at £1,200 for what exactly we couldn't get a straight answer.

It was academic though, neither of our cars lasted long enough to reach first service.

 

[Bobby Dazzler]

First service was quoted at £1,200 for what exactly we couldn't get a straight answer.

It was academic though, neither of our cars lasted long enough to reach first service.

The Internet says: Pollen filter, brake fluid, drain cleaning plus the usual visual checks of an ICE service it seems.

Prices seem to range from less than £400 to around £1200, and all items due every two years or 20,000 miles.

OPC Colchester seems to be the place to go for best price servicing - I’d say £200 per annum seems pretty good to me.

 

[Skd884]

Motorpoint confirms £3.7m loss as bosses express fears over 'rapidly' falling used car prices – Car Dealer Magazine

Used car supermarket Motorpoint has confirmed sky-high losses after posting its interim results for the first half of the year. Car Dealer reported last

cardealermagazine.co.uk

 

[MikeInWimbledon]

Motorpoint confirms £3.7m loss as bosses express fears over 'rapidly' falling used car prices – Car Dealer Magazine

Used car supermarket Motorpoint has confirmed sky-high losses after posting its interim results for the first half of the year. Car Dealer reported last

cardealermagazine.co.uk

Other interpretations are available. Note the £2.4 million increase in finance costs and the million quid's worth of hopefully one-off "exceptionals" to "right size,"
compared to the equivalent period the previous year.

 

[Skd884]

Falling used car prices and new car supply outpacing demand leads Vertu to slash forecasts – Car Dealer Magazine

Vertu Motors has slashed its profitability predictions for next year due to weakening used car values and new car supply 'exceeding natural demand

cardealermagazine.co.uk

 

[Darrell]

In a different category, there’s some sucking of teeth going on about 2nd and third cars. I’ve had a few friends chewing the fat recently about losing that expensive weekend toy (AMG / 911/ Audi SQ) or garage queen that was easy to justify when money didn’t cost or earn anything, but which seems expensive when any idiot can earn interest on cash again. Our hearts go out to the Shmee150 extreme. Poor wee things.

I’ve still got my ‘weekend’ toy which in reality is a yearly toy.

 

[Scooby_Doo]

Is it the credit squeeze or is the used car market getting back to pre covid prices ?
At the end of April 23 I p/exd my 2018 C250d 4matic (31k miles) for £21,500 (same WBAC Offer) against a 3 month old Macan , not much wiggle room with Porsche. Out of interest I got an updated price today (added 3000 miles ) and got an offer of £17,150 which is a drop of £4,350 in just over 3 months.

Just an update on the above - WBAC are now offering £14,000 for the C250 above, so now down £7500 in 7 months , glad I sold it in April.

 

[MikeInWimbledon]

Just an update on the above - WBAC are now offering £14,000 for the C250 above, so now down £7500 in 7 months , glad I sold it in April.

But if your C250 went down by £7500 in 7 months, wouldn't you have been better off in staying in it, and buying a ten month old Macan now ?

The depreciation of the newer car - surely - must be worse?

How does WBAC value your Macan as a Trade-in? Surely it will have taken an even bigger bath and be below £50k as a trade-in now?

 

[MikeInWimbledon]

Falling used car prices and new car supply outpacing demand leads Vertu to slash forecasts – Car Dealer Magazine

Vertu Motors has slashed its profitability predictions for next year due to weakening used car values and new car supply 'exceeding natural demand

cardealermagazine.co.uk

It's interesting that this article, again, doesn't acknowledge the increase in financing costs both for dealer stock, and as a brake of consumer purchase.

It's an old cliche that dealers, like manufacturers, make money out of the finance deals, but equally if borrowing's cheap, it's easy just to have a full forecourt or more outlets.

 

[markjay]

Is the used car market getting back to "normal"

Is it the credit squeeze or is the used car market getting back to pre covid prices ?

The inverted commas are the giveaway... what's 'normal'? Was it 'normal' before COVID?

It's supply and demand.... buy when supply is plentiful, sell when demand is high - the First Law of Economics

 

[markjay]

As for depreciation, of course it's a good idea to buy a 2-3 years old car because often that's when the car has already shed the bulk of its value.

However, the savvy second-hand car buyer will know to differentiate between a car model that loses value because it's unreliable or otherwise undesirable, and a model that lost value simply because of market flooding, which is what typically happens with ex-lease cars after 2-3 years.

I have bagged good deals on two Vauxhall Omega and two C-Class over the years... and you don't actually have to buy an ex-lease car (not that there's anything wrong with it), it's sufficient for the model to be a fleet favourite, as it will bring down prices across all second-hand cars of this model, whether privately-owned or ex-lease.

 

[markjay]

In the same vein, I expect that 'BIK Heros' EVs will have well started flooding the market by now, given the the nil BIK tax band was introduced around 5 years ago. Those EVs that were the company drivers' favourites 2-3 years ago should be very competitively priced right now for second hand buyers.

 

[MikeInWimbledon]

The inverted commas are the giveaway... what's 'normal'? Was it 'normal' before COVID?
It's supply and demand.... buy when supply is plentiful, sell when demand is high - the First Law of Economics

Agreed broadly, but isn't the first law of economics that "there's not enough supply of anything to satisfy all those who might want it?"

So price is where demand meets supply

After clearing the constipation in the supply chain, adjusting to the Russia / Ukraine situation AND dramatically changing the cost of money.... prices move to a different level?

(Oh, and nil Benefit In Kind for Electric cars came into effect three years ago, from the 2020/21 tax year. Looking at the implementation lags ( ordering, covid19, supply and finally disposal), the bounce in Zero BIK Tesla 3's are only just now coming onto the used car market.)

 

[ALFAitalia]

BIK tax on EVs is not zero.
Before 2021, EVs were exempt from paying any BiK tax. The rate went up to 1% in April 2021, and changed again in April 2022 to 2%. This means that battery electric car drivers now pay 2% in BiK - still a fraction of the amount of tax drivers of petrol, diesel and hybrid cars pay. The 2% rate is fixed until April 2025 at 2%, and then will increase by 1% each year until 2028. After that?.....well it's bound to go higher....got to recoup all that lost tax somewhere.

 

[MikeInWimbledon]

BIK tax on EVs is not zero.
Before 2021, EVs were exempt from paying any BiK tax. The rate went up to 1% in April 2021, and changed again in April 2022 to 2%. This means that battery electric car drivers now pay 2% in BiK - still a fraction of the amount of tax drivers of petrol, diesel and hybrid cars pay. The 2% rate is fixed until April 2025 at 2%, and then will increase by 1% each year until 2028. After that?.....well it's bound to go higher....got to recoup all that lost tax somewhere.

Obviously. The zero percent BIK was introduced in July 2019, taking effect from April 2020. That was the trigger that made EV's the default choice for any business user. The Tesla 3 is a rubbish vehicle compared to a BMW 3 series, but who's going to turn their back on a £5,000 a year tax saving? That's an extra £5k cash in your bank account.

Even I would run a rubbish Tesla 3 instead of a BMW 520d if it was saving me £15,000 in cash over three years.

MarkJay originally suggested that the tax break had been around for five years. I just pointed out that implementation lags would only have affected the last three years.

 

[splitpin]

At the end of the day, a pro golfer can always use a Ferrari for practice days.

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Yes,prices are dropping. Local M-B franchised dealer has dropped £20k C class
by £2.5k recently & of course trade-in plummets also.

 

[markjay]

BIK tax on EVs is not zero.
Before 2021, EVs were exempt from paying any BiK tax. The rate went up to 1% in April 2021, and changed again in April 2022 to 2%. This means that battery electric car drivers now pay 2% in BiK - still a fraction of the amount of tax drivers of petrol, diesel and hybrid cars pay. The 2% rate is fixed until April 2025 at 2%, and then will increase by 1% each year until 2028. After that?.....well it's bound to go higher....got to recoup all that lost tax somewhere.

I would hazard a guess that the majority of second hand EVs on the market today started their life as a car in a nil (or near-nil) BIK business lease. If so, then - again - the company drivers' favourites at the time will now be as cheap as chips on the second-hand car market. How much is a 3-5 years old i-Pace these days? Etc.

 

[Scooby_Doo]

But if your C250 went down by £7500 in 7 months, wouldn't you have been better off in staying in it, and buying a ten month old Macan now ?

The depreciation of the newer car - surely - must be worse?

How does WBAC value your Macan as a Trade-in? Surely it will have taken an even bigger bath and be below £50k as a trade-in now?

Appreciate your point above but things are/were somewhat complicated to compare. I'd ordered a new Macan T (2.0 version) with the P/ex price being price on delivery , probably Oct 23. If I'd wanted a Macan S (2.9 v6 version) delivery was quoted as March 24 and p/ex price on delivery.
Porsche upped their prices in April 23 which pushed the price of a Macan T to £70k so had a look on Porsche used website. I found my Macan S at Sheffield Porsche which had all the options I wanted plus a few more options which (which I couldn't really stretch to on the new T ) . The car was 3 months old with 3500 miles on the clock and was £10k under OTR list which was the same price as the newMacan T , and most other ex demos ( only about 12 available in the UK ) at the time were at least full list price.

So my man maths at the time was :- I get a V6 Macan , which in my heart I really wanted but couldn't quite stretch my budget to, 12 months earlier than ordering a new one and the same price as the new T. My p/ex price was, estimated in April, about £3k more and Road tax was £550 instead of the £2200 on a new Macan. I also got Running boards, acoustic glass , electric towbar (probably never use) , full extended leather, heated windscreen and blind spot monitoring .

Man maths now - as above but P/ex would have been £6k less than April which I must assume covers my depreciation on the Porsche since buying it. No point putting the Porsche into WBAC as they'll only base the price for a standard Macan , Porsche dealers are still asking what I paid in April for similar cars now so my allowing them circa £5k mark up I'm still no worse off than if I had kept the C class and I've had the pleasure of driving the 380 bhp Macan for 7 months.

 

[AMGeed]

Certain model prices are not dropping at all over the past 9 months I have been looking.